Tuesday, October 13

Of course U.S. Secretary of State is blaming the attacks on Israel's settlement policy, which has been in effect for how long? And I see the New York Times headlines a report today that reads, "Leaderless Palestinian Youth, Inspired by Social Media, Drive a Rise in Violence." Those youth have been leaderless for a long time and living at social media sites for years. I think the real story is that the smuggling gangs have lost a lot of money since Egypt's military finished flooding the Gaza-Sinai smuggling tunnels with shit. Well, why waste precious water on the tunnels? They may have used water in some cases but mostly they pumped in sludge from human and animal waste to put the tunnels out of commission permanently. As for Hamas building more tunnels -- they don't run as tight a ship as El Chapo and they can't. Plenty of snitches to be bought in that part of the world for a song I wouldn't be surprised if Eygpt's military waits for Hamas to go the expense of building the tunnels, then floods them. So why aren't leaderless Palestinian youths stabbing Egyptians? First of all the Israelis surely cooperated with the Egyptian tunnel decommission project. Second, unlike Israel, which is stuffed with Bleeding Heart Liberals, the Egyptians have run out of patience with Palestinians. If just one Egyptian is stabbed, that's all Egypt's military would need, with the rest of Egypt cheering them on. Everyone in the Middle East knows this. See also Three Coordinated Terror Attacks in Jerusalem Today, Netanyahu: Israel to Take 'Aggressive Steps' in Crackdown on Attacks and Israel embassy in Berlin blasts German media for slanted terror coverage. The larger picture suggests to me that Palestinians and Europeans better pay closer attention to the financial pages and the weather, then exert themselves be a lot nicer to Israelis. The United Nations has warned that Gaza has four years before it runs completely out of water -- and even now the water there is unsafe to drink and that's also for the trucked-in supplies. Sometimes the UN overstates a situation but in this case their time frame looks accurate.As to where the Gazans are going to go when the spigots shut off -- Jordan is almost full up even though they have a large refugee camp that stands practically empty. Syria is out. Lebanon is full up. The Gulf Arabs don't want them. Iran doesn't want them. Egypt doesn't want them. I guess that leaves Europe. Yet the Gaza water situation is nothing next to what's on the way. Western Europe and Britain frittered away hundreds of billions of euros and pounds to further their plan to destroy Israel. Much of the money was siphoned off by Iran but it's all going to fall back on Europe without Israel lifting a finger. And yet Israel is the one country that could have saved the Muslim Arabs who call themselves Palestinian. And no, they would not be able to save themselves even if they could take over Israel. The European welfare scheme raised a generation of people who think like little emperors. They did the same thing to many Palestinians that successive American governments did to many American blacks. Expats were the only Palestinians who escaped the European-fueled welfare state that turned reasonably rational people into gibbering losers. As to Iran -- I think within about 4 years Iran and Israel are going to be the best of friends or at least transactional friends. I don't think Iran will have a choice by then. Even now they're foolish not to resurrect the pipeline built in the last Shah's reign between Iran and Israel. The Iranians are bleeding themselves dry fighting the Gulf oil kingdoms, but a lucrative and more effective way to fight would be to hook up with Israel and Russia oil pipeline schemes.As to the financial pages, Bill Holter, posting at Jim Sinclair's Mineset on October 11 pulled together a pretty good summary even though he doesn't tackle the oil situation. According to a Bloomberg report from a few weeks ago, the only thing that's propping up the price of oil from a 20 percent drop is a massive buying spree by China's government to add to their strategic reserve. Once they stop the project, which will be sometime in 2016 and maybe in the summer, then it's free fall for the price. That's great news in some ways, but not for governments that depend heavily on oil exports.

[...]Last week was a true dichotomy of fantasy and reality. We witnessed a massive short squeeze and the best week for U.S. equities in over a year. While the markets were oversold and due a bounce, the “bounce” came with a backdrop of very dire news! Day after day brought forth new and consistently worse news.

In no particular order of importance; Deutsche Bank reported a $6.5 billion loss (10% of their net equity), UBS joined the derivatives implosion party and required a capital raise, Glencore ‘fessed up to $100 billion in debt versus the previous $19 billion (with three or four other major commodity firms in the same boat), the Bank of England required their banks to disclose how much of this debt they were exposed to, China’s yuan surpassed the yen in the settlement of global trade,

China also went live with their alternative settlement of trade in yuan (non dollars), Saudi Arabia and Norway disclosed they are now in deficit and thus no longer “buyers” of dollars (are they now sellers?) …and the U.S. was effectively kicked out of the Middle East!

I might add that several recent economic reports even though fudged, massaged and outright falsehoods were unable to hide the reality of global and U.S. recession and decline in the real economic sectors.

To top all of this off, the U.S. Fed has now attracted naysayers including our (their) own bought and paid for media. They have effectively lost credibility. Since the last Fed meeting, the world has collectively come to the conclusion they have no options left and credible monetary policy is not a possibility. In fact, Mr. Trichet of Europe’s central bank has admitted that global central banks can no longer save the day or even buy time.

On the other side of the financial coin, John Boehner resigned a couple of weeks back and his proposed replacement, Congressman Kevin McCarthy, withdrew his name from consideration. Please understand what this really means; the U.S. House of Representatives has now been hijacked by a minority [of ultra-conservative Republicans] which controls the majority.

Normally this might be a good thing as a divided Congress cannot spend money (it does not have). Currently I believe this is a very bad event because it proves the further loss of credibility in U.S. leadership is valid.[...]

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